KAZAKHSTAN: SCENE SETTER FOR CENTCOM COMMANDER

S E C R E T SECTION 01 OF 11 ASTANA 000022

SIPDIS

STATE FOR SCA/CEN, PM
STATE PLEASE PASS TO USTDA DAN STEIN

E.O. 12958: DECL: 01/01/2034
TAGS: PGOV PREL ECON EPET MARR MCAP MASS AF KZ
SUBJECT: KAZAKHSTAN: SCENE SETTER FOR CENTCOM COMMANDER
GENERAL PETRAEUS

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Classified By: AMBASSADOR HOAGLAND: 1.4 (A),(B),(D)


1. (S/NOFORN) SUMMARY: Your visit will foster our
bilateral cooperation and our strategic interests, and will
provide you the opportunity thank the Government of
Kazakhstan for its support to Operation Iraqi Freedom and
continued support of Operation Enduring Freedom, to encourage
and support the government,s commitment to deploy forces to
Afghanistan, as well as the opportunity to discuss and build
support for the Distribution Network of Operation Enduring
Freedom (DNOEF). END SUMMARY.

DOMESTIC POLITICAL PERSPECTIVE


2. (SBU) While the Kazakhstani government articulates a
strategic vision of a democratic society, it has lagged on
the implementation front. The government is resistant to
fully competitive political processes, and the situation is
complicated by the fact that President Nazarbayev is
extremely popular, while the opposition is weak, fractured,
and comprised principally of former Nazarbayev loyalists.
In May 2007, significant amendments were adopted to
Kazakhstan's constitution which were touted as strengthening
parliament, but also removed terms limits on Nazarbayev. In
parliamentary elections held in August 2007, Nazarbayev's Nur
Otan party officially received 88 percent of the vote and
took all the seats in parliament. An OSCE election
observation mission concluded that the elections did not meet
OSCE standards.


3. (SBU) When Kazakhstan was selected as 2010 OSCE chairman
at the November 2007 OSCE Madrid ministerial meeting, Foreign
Minister Tazhin publicly committed that his country would
undertake several democratic reforms -- specifically, that by
the end of 2008, Kazakhstan would amend its election,
political party, and media laws taking into account the
OSCE's recommendations. (NOTE: Tazhin also promised that
Kazakhstan would support the OSCE's "human dimension" and
preserve the mandate of the OSCE's Office of Democratic
Institutions and Human Rights (ODIHR),including its critical
role in election observation. END NOTE). The necessary
legislation went to parliament in December.


4. (SBU) While the laws have the potential to lead to
greater democratization, Kazakhstan will need to take further
steps to bolster its still underdeveloped democratic
political institutions, civil society, and independent media.
A new religion law that would significantly impact the
rights of smaller non-traditional faiths passed parliament in
December, but due in part to pressure from civil society and
the international community, the president has opted to send
the law to the Constitutional Council (Court) for review.

INTERNATIONAL POLITICAL PERSPECTIVE


5. (C/NOFORN) Kazakhstan openly seeks to balance the
interests of Russia, China, and the US/West in its foreign
policy. Consider this balance to be based on a triad:
Russia-US-China, CSTO-NATO-SCO. Kazakhstan publicly claims
to be Russia,s closest ally and, in truth, it would be
counter-productive for them to deny the geographic, cultural,
and economic ties that continue to bind them with Russia.
China is a fast-growing consumer of Kazakhstan's natural
resources and allows Kazakhstan the flexibility to avoid
being monopolized by Russia. However, Kazakhstan has
lingering concerns about Chinese encroachment. The U.S.
relationship is unique in that the United States does not
threaten Kazakhstan since it is not geographically proximate.
U.S. policy allows Kazakhstan to keep and exercise a greater
range of options with respect to Russia and China. The
United States and Kazakhstan share the common goal of helping
Kazakhstan to become a strong independent nation, capable of
governing its vast terrain, expanding its hydrocarbon
transport infrastructure for export of its energy resources

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to the global market, and enhancing stability throughout the
region.

ECONOMIC ISSUES


6. (SBU) Kazakhstan is the region's economic powerhouse,
with an economy larger than that of all the other Central
Asian states combined. Economic growth averaged 9.2% a year
during 2005-07, and the percentage of the population living
below the poverty level dropped from 28% in 2001 to under 14%
at present. Economic growth has slowed as a result the
global financial crisis and was just 3% in 2008. While the
country's economic success is partly due to its fortuitous
natural resource deposits, astute macroeconomic policies and
extensive economic reforms have also played important roles.
Kazakhstan has a modern banking system, well-endowed pension
fund, and a sovereign wealth fund with over $27 billion in
assets -- which serves double duty as a prophylactic against
Dutch disease and a cushion against hard economic times.
Increased globalization and integration of the economy have
complicated the domestic financial situation in Kazakhstan
over the last year. Plummeting commodity prices
(particularly oil) have forced the government to recalibrate
its 2009-2011 budget several times in recent months. In
October, the government announced that it would use up to $10
billion from the sovereign wealth fund for a bailout plan to
mitigate the domestic impact of the global financial crisis.
Indicative of the severity of the crisis, the bailout has
since increased to $21 billion, which represents
approximately 20% of the country,s GDP. It is also likely
that Kazakhstan will seek to renegotiate the terms of its
foreign debt to prevent its highly-leveraged private domestic
banks from defaulting. Over the long run, Kazakhstan must
focus on diversifying its economy, building up non-extractive
industries, agriculture, and the service sector. Kazakhstan
is a major wheat producer, with a goal of ranking
consistently among the world's top five wheat exporters.


7. (SBU) The energy sector is Kazakhstan's dominant earner,
with oil exports accounting for roughly one third of GDP.
Kazakhstan will export more than 60 million tons of crude oil
and gas condensate in 2008 and is expected to be one of the
world,s top ten oil producers soon after 2015. The country
also has significant natural gas reserves -- 1.8 trillion
cubic meters is a low-end estimate -- but for now, natural
gas exports are relatively small, just 5 billion cubic meters
in 2008, in large part because gas is being re-injected to
maximize crude output. U.S. companies have significant
ownership stakes in Kazakhstan,s three largest oil and gas
projects: Kashagan, Tengiz, and Karachaganak.


8. (SBU) The United States is encouraging the Government of
Kazakhstan to diversify its oil and gas export routes.
Currently, the bulk of Kazakhstan's crude is exported via
Russia, both through the Transneft system (Atyrau-Samara) and
the independent Caspian Pipeline Consortium (CPC). The
majority of Kazakhstan's near term oil production increases
are projected to flow to market either through the
Baku-Tbilisi-Ceyhan pipeline or an expanded CPC. All of
Kazakhstan's gas exports currently flow through Russia.
Kazakhstan has taken steps to diversify its energy exports by
shipping oil across the Caspian Sea in tankers and building a
gas pipeline to China. These projects, which are in their
initial stages of development, would reduce dependence on
Russia hydrocarbon infrastructure.


9. (SBU) One issue that is certain to be at the center of
discussion for years to come is water management. Reviving
the northern portion of the Aral Sea, which Kazakhstan
controls, has been a resounding success. A greater priority
is ensuring continued access to water for public and
agricultural use. As most of Kazakhstan's rivers have
headwaters outside of the country, Kazakhstan remains
somewhat vulnerable to outside pressures. For the moment

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this is not a problem as glacial melt has made up the
distance in quantity versus demand. But the long-term issue
is that Kazakhstan is drawing against a bank account that
cannot be easily replenished. Anecdotally, we have been told
that the Ishim River (the river that flows through Astana and
has its headwaters in China) has decreased by one meter over
the past few years due to increased upstream use in China.
In addition to securing an adequate quantity of water,
Kazakhstan also remains concerned about water quality. On
October 10, presidents of the five Central Asian countries
signed an agreement on water use and energy security to
ensure sufficient supplies during the winter of 2008-09. The
water-use protocol includes provisions to increase the water
level of the Toktogul reservoir in Kyrgyzstan and agreement
between Uzbekistan and Kazakhstan to provide Kyrgyzstan with
coal, fuel oil, and gas for Kyrgyzstan,s thermal power
plants.

REGIONAL INFLUENCE AND SUPPORT


10. (SBU) Kazakhstan has also expressed its eagerness to
play an enhanced role in achieving regional integration.
President Nazarbayev continues to raise the subject of a
Central Asian union with a common market. Kazakhstan is
ready to accelerate WTO accession negotiations with the
United States. However, the international financial crisis
is making some Kazahstani officials more skeptical about the
benefits of WTO membership. Instead, they see immediate and
tangible benefits from a possible near-term customs union
with Russia and Belarus, which could dramatically slow -- or
derail -- Kazakhstan's WTO accession. We know Russia has
long opposed Kazakhstan's WTO membership before its own
accession. The new customs union, if Kazakhstan follows
through, as it currently seems likely to do, would be a
convenient way for Moscow to limit Astana's sovereignty. To
sell a WTO agreement to the president and prime minister,
Kazakhstan has asked for concessions from the United States,
especially on banking and financial services. Kazakhstan is
already a significant economic force in the region and it is
the largest foreign investor in Kyrgyzstan and in Georgia.
While progress has been slow, Kazakhstan has begun economic
investment in Afghanistan.

CSTO AND SCO


11. (C/NOFORN) Kazakhstan's involvement in the Russian-led
Collective Security Treaty Organization (CSTO) is a natural
extension of its historical relationship with Russia, as well
as its Commonwealth of Independent States (CIS) membership
and mutual security ties with other CIS states. Kazakhstan's
actual contributions to the CSTO appear to be more political
than substantive. The CSTO mechanism provides a means for
Kazakhstan to stay connected to Russia on issues of mutual
concern (air defense, counter-terrorism, etc.),but without
the danger of getting too close. At the CSTO's 2008 Summit
in Moscow, Russia pressured the CSTO partners to recognize
South Ossetian and Abkhazian independence and to make strong
statements about Georgia,s responsibility for the current
conflict, however, Kazakhstan and the other CSTO members did
not cede to Russian pressure and collectively the CSTO
Ministers urged all parties to the conflict to adhere to the
principles of the France-Russia six-point plan. Kazakhstan's
membership in the Shanghai Cooperation Organization (SCO)
provides a means for it to counterbalance its CSTO membership.

MILITARY/DEFENSE PERSPECTIVE

KAZAKHSTAN'S MINISTRY OF DEFENSE (MOD)


12. (S/NOFORN) Former Prime Minister Daniyal Akhmetov
became Kazakhstan,s first civilian Minister of Defense in
early 2007. The previous Minister of Defense, General
Mukhtar Altynbayev, is now the Chief of Defense (CHOD).
Minister Akhmetov is an avowed Russophile whose Russian

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connections and support have proven to be personally
lucrative. U.S. and NATO military cooperation suffered
significant setbacks and delays for the first year of his
tenure. Unable to halt military cooperation with the west,
Akhmetov has actively sought to supplant MOD conduits that
see cooperation with the West as being in the best long-term
interests of Kazakhstan. Although recent events and
indicators posit an improvement in the security cooperation
sphere, we are unsure if this is due to Akhmetov,s
recognition of the value of U.S.-Kazakhstani cooperation or
if this change is due to directives/pressure from above.
Additionally, Akhmetov considers training less than two to
three months in duration to be military tourism, and sees
little value in short-term training.

UNEQUAL PARTNERSHIP


13. (S/NOFORN) The MOD remains an under-funded ministry
that has no policy-making authority. The simple fact is that
the U.S. DOD-Kazakhstani MOD relationship is not one of
equals. DOD has significant policy input in the USG, while
the MOD appears to have almost none. In short, the
Kazakhstani MOD is a supporting ministry, taking its
direction from higher levels within the government. The
United States has, on a number of occasions, successfully
achieved its bilateral and regional goals by appealing to
those closer to the center of power and using them to provide
the MOD with marching orders.

MILITARY OPERATIONS/SUPPORT


14. (SBU) IRAQ: Kazakhstan directly supported coalition
efforts in Iraq beginning in August 2003, most significantly
by deploying a military engineering/explosive ordinance
disposal (EOD) unit which cumulatively disposed of over five
million pieces of unexploded ordnance. With the
reorganization of the coalition in Iraq, Kazakhstan recently
completed its tenth rotation and in late October redeployed
its forces in their entirety.


15. (SBU) AFGHANISTAN: The USG continues to solicit support
for increased participation in international operations, and
it appears that Kazakhstan will, in the near-term, deploy two
staff officers to support ISAF HQ in Afghanistan.
Additionally, the Kazakhstani government is currently
negotiating with NATO to provide Kazakhstan maximum
flexibility in its future support to ISAF of up to a
company-size element. Kazakhstan is looking to increase its
coalition contributions to Afghanistan over time, but has
been non-committal on specifics. The MOD is seeking to match
NATO requirements with Kazakhstani capabilities, and the
Deputy Minister of Defense, General-Lieutenant Bulat
Sembinov, has requested the U.S. Defense Attache coordinate a
visit with the ISAF Commander, General McKiernan, to discuss
future Kazakhstani contributions. A deployment of
Kazakhstani forces is supported by Deputy Minister Sembinov
and other pro-western supporters within the government who
understand the value of conducting real-world operations in
terms of building political capital and capitalizing on
deploying and training the force. Additionally, the
Government of Kazakhstan provided funding of $3 million to
Afghanistan in 2008, primarily for infrastructure improvement
and development.

OVERFLIGHT AGREEMENT


16. (C/NOFORN) In support of Operational Enduring Freedom
(OEF),the Government of Kazakhstan has granted more than
7,000 cost-free overflights since the agreement,s
entry-into-force in 2001. This equates to an annual average
of over 1000 U.S. military and DOD charter aircraft
overflights. This agreement does not differentiate between
types of cargo, allowing it to be used for the transport of
weapons and ammunition. No other country has such a heavily

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used overflight agreement with Kazakhstan. Russia has
overflight for military training in designated polygons.
Germany has brokered a blanket overflight agreement for OEF
support missions similar to ours. China may now have a
limited agreement in support of military exercises, but
France has recently been denied a blanket agreement similar
to that of the Germans. President Nazarbayev last week
signed into law the 2001 no-cost overflight agreement for
flights supporting OEF and 2002 emergency divert agreement
that parliament only just ratified. (NOTE: The agreements
have been in force since their signing in 2001 and 2002,
respectively. END NOTE). This fact was quickly picked up by
the Russian press, fed into the Russian propaganda machine,
and led to false Russian MOD accusations that the United
States was planning to establish military bases in Kazakhstan
and Uzbekistan. These accusations have been unequivocally
denied as unfounded by U.S. Embassy Astana as well as by the
Government of Kazakhstan. Kazakhstan also signed an Article
98 agreement with the United States in late 2004. We
recommend you thank Government of Kazakhstan officials at all
of your meetings for their cooperation in allowing U.S.
flights supporting OEF to transit Kazakhstan.

EMERGENCY DIVERT AGREEMENT


17. (SBU) In 2002, an emergency divert agreement with the
Kazakhstan entered into force that allows aircraft bound for
Manas the option of landing at Almaty International Airport
in case of bad weather or emergency. More than 85 diverts
have been supported under this agreement. In every case,
Kazakhstan has exceeded the expectations of the original
agreement. However, one of the limiting factors under the
provisions of this agreement is the restriction which does
not allow disembarkation of troops from the diverted
aircraft. U.S. forces traveling on deployment orders usually
do not have passports or visas and, therefore, cannot legally
enter the country to stay at a hotel or be transported by
alternate ground means to Manas. Should the Kazakhstani
Government allow U.S. forces entry into Kazakhstan, USDAO has
no mechanism in place to fund costs associated with
transportation or lodging. Since the agreement,s entry into
force, the USDAO has relocated from Almaty over 600 miles
north to Astana and cannot react quickly to support incoming
diverts. The limitations of our divert agreement were
highlighted last winter when a charter aircraft carrying 125
101st Airborne troops diverted into Almaty International
Airport. Troops were required to remain onboard the aircraft
for approximately 18 hours. Almaty airport services did an
excellent job providing uninterrupted support (meals, power,
heat, water, etc.) for the divert duration.

DISTRIBUTION NETWORK OF OPERATION ENDURING FREEDOM


18. (SBU) The Distribution Network of Operational Enduring
Freedom (DNOEF) has been Embassy Astana,s number one
priority since the November visit of General Duncan McNabb,
Commander, USTRANSCOM. As you are aware, President
Nazarbayev approved the use of Kazakhstan,s commercial
transport infrastructure to support the DNOEF for resupplying
our forces in Afghanistan on 30 December 2008.


19. (C/NOFORN) As background to previous non-U.S. transit
agreements, NATO has been limited to one option -- the
transport of non-lethal supplies through Russia, Kazakhstan
and UzbekistaN -- and continues deliberations with those
countries in an attempt to secure a written transit agreement
to resupply forces in Afghanistan. Of note is that the
Government of Kazakhstan was extremely unhappy that NATO
sought permission of its big brother, to the north before
opening discussions with the Kazakhstanis. The government
indicated negotiations should have occurred in parallel
rather than in serial. The German Government recently
negotiated an official government-to-government agreement
with Kazakhstan for the transit of both lethal and non-lethal

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supplies destined for Afghanistan. Although this agreement
is available for a third party to use, it is our belief that
should we want to enter into this agreement, it would
undermine the DNOEF concept and our efforts because it would
formalize the process under a written agreement that would
prove to be too cumbersome because it would require
governmental ratification and, at a minimum, detailed
coordination and notification of all shipments transiting
Kazakhstan. Bottom line: don,t punch a tar baby that you
may not be able to extricate yourself from.


20. (C/NOFORN) Additionally, it would be in our best
interests to use all available routes to include Russia as a
viable alternate transit route. In a conversation between
the U.S. Defense Attache to Kazakhstan, Colonel Keith
Harrington, and the Russian Defense Attache to Kazakhstan,
General-Lieutenant Nikolay Pokas, General Pokas queried
Colonel Harrington on General McNabb,s visit and stated that
Russia supported the transit of supplies through Russia
because "it is good for Russian commercial business." This
conversation highlights an important factor regarding the
DNOEF: that we should include rather than attempt to bypass
or imply that we will not include Russia as a viable
alternative transit route. Should we purposely choose to
bypass Russia, then it is likely that Russia could and would
pressure the Government of Kazakhstan to not allow supplies
to transit Kazakhstan. It is our strong belief that
including Russia as part of the DNOEF is a win-win situation
and would provide the U.S. another route to resupply our
forces in Afghanistan.

AVIATION FUEL


21. (SBU) Since Kazakhstan has a limited refining
capability, it imports most of its aviation fuel from Russia.
Some of this fuel is in turn sold to Manas AB, Kyrgyzstan.
In this way, Russia indirectly provides fuel for Manas AB and
OEF operations.

KAZAKHSTANI ASSISTANCE TO GEORGIA


22. (SBU) In response to the Georgian-Russian conflict,
Kazakhstan provided 165 tons of humanitarian aid to the
Government of Georgia consisting of food, medicine and
medical equipment worth approximately $460,000.

NON-PROLIFERATION ISSUES


23. (SBU) Kazakhstan has been a strong partner in nuclear
non-proliferation, which has been a cornerstone of the
bilateral relationship since Kazakhstan's independence. With
the collapse of the Soviet Union, Kazakhstan was left with
the world's fourth largest nuclear arsenal. Nazarbayev's
1991 decision to give up Kazakhstan's nuclear arsenal was
groundbreaking. Kazakhstan returned all tactical nuclear
warheads to Russia by January 1992, and all strategic nuclear
warheads by April 1995. Through the Nunn-Lugar Cooperative
Threat Reduction (CTR) Program the US assisted Kazakhstan
with the destruction of bombers, silos, and related ICBM
infrastructure and delivery systems.


24. (S/NOFORN) While the U.S.-Kazakhstan non-proliferation
relationship seems to be solid on the surface, at working
levels, the U.S. and Kazakhstani governments have encountered
continuous implementation issues. The Umbrella Agreement
amendment governing the CTR program, signed in December 2007,
has still not been ratified by Parliament. An early October
visit by Secretary of State Rice put the issue on the front
burner, and President Nazarbayev signed a decree to approve
the extension/amendment, sending it forward for action. The
Prime Minister,s Office is still reviewing the CTR
Agreement, which has been sent back and forth between the
Ministry of Energy and Mineral Resources and various
government experts. The Ministry of Foreign Affairs expects

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the CTR extension to be ratified by Parliament in January

2009. Ratification is the first step to provide Kazakhstan
with a legal basis to establish a mechanism to implement
value added tax (VAT) and duty exemptions for imported
equipment and services contracts through the CTR program.
Taxation issues have festered unresolved since 2004, leading
to frustration at high levels in Washington, both in the
Executive and Legislative branches.


25. (S/NOFORN) Of all of the projects funded by the CTR
appropriation, the most critical is a classified project to
secure weapons-grade materials at the former Soviet nuclear
weapons test site in Semipalatinsk. The project is
tri-lateral, between Russia, Kazakhstan, and the United
States, with the Russians providing the necessary data
regarding material location and the United States providing
funding to repatriate the material to Russia or secure it in
situ. Due to complexities in the trilateral relationship
between the United States, Russia and Kazakhstan, and
uncertainty about future trilateral commitments to this
project, the USG is ready to reprogram up to $100 million to
finish the work at the site within the next two years.
DOD,s current goal is to see the Government of Kazakhstan
increase its security presence at the site (Ministry of
Internal Affairs or troops),and discussions are underway to
identify technology that can be used to assist Kazakhstan
monitor the site for trespassers.


26. (SBU) In addition to the classified trilateral project
in Semipalatinsk, the Department of Defense is currently
implementing two CTR projects in Kazakhstan. The first, the
Proliferation Prevention Initiative (PPI),strengthens
Kazakhstan,s ability to prevent the proliferation of Weapons
of Mass Destruction (WMD) and related materials across its
borders by enhancing WMD detection and interdiction
capabilities along the Caspian Sea border. The second, the
Biological Threat Reduction Program, supports Kazakhstan,s
efforts to combat bioterrorism and prevent the proliferation
of biological weapons technology, pathogens and expertise by
strengthening its outbreak response and monitoring
capabilities. The Department of Energy also has several
projects that are focused on securing nuclear materials, and
the Department of State funds additional nonproliferation
projects implemented by the International Science and
Technology Center (ISTC).

SECURITY ASSISTANCE AND ENGAGEMENT OVERVIEW


27. (S/NOFORN) We harbor no illusions. Russia is and will
remain Kazakhstan's number one security partner. We do not
seek to displace Russia from that role, but do believe the
U.S. role in the security sphere is an important one. We
continue to focus on three key areas (besides DTRO-A CTR
work) with a long-term goal of transforming the Kazakhstani
Armed Forces into a deployable force which can not only
adequately protect national sovereignty, but also become an
agent of democratic reform and rule of law within Kazakhstan.
These three areas of concentration are: Defense Reform
(both doctrine and equipment),security of the ungoverned
spaces of the Caspian Sea Basin and Western Kazakhstan, and
the development of a deployable Peace Support Operations
(PSO) capability and deployment in support of multilateral
UN-sanctioned operations. This is a long-term goal, but one
where we have seen significant progress over the past few
years.


28. (S/NOFORN) COMMENT: The bottom line is that U.S.
credibility and reliability are at stake with these programs.
Our security assistance (SA) and engagement programs are
designed to shape the security environment, critical to our
strategic interests writ large. The tangible result of a
successful SA program is building partnership capability,
whereas the intangible result of an unreliable SA program is,
at a minimum, the loss of our credibility as a partner. Our

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national security interests are ultimately at stake, with our
reliability and credibility paramount to these interests.
Our current SA system has difficulties meeting this
challenge. The systemic effects are most evident regarding
the Foreign Military Financing (FMF)/Foreign Military Sales
(FMS) aspects of the SA process, which neither builds nor
delivers the total package, and makes it difficult to
shape our security environment on the macro level. On the
micro level, it results in the lack of enthusiasm for partner
nations, such as Kazakhstan, to commit national funds to
modernization and transformation processes and
interdependence and interoperability with U.S. forces. END
COMMENT.

HMMWVs


29. (SBU) Kazakhstan currently has 50 light HMMWVs and is
expecting a delivery of 50 up-armored HMMWVs in FY 2009
through the 1206 program. The KAZBRIG uses the HMMWVs for
training peacekeepers and is expected to deploy with them to
a future PSO operation. MOD has made a commitment to the
sustainment of the HMMWVs through the development of the Asia
HMMWV Center and a Unit Maintenance facility at KAZBRIG. The
initial success of the HMMWV program in Kazakhstan led to the
MOD requesting eight UH1H II "Huey II" helicopters through
the FMF program.

HUEY II HELICOPTERS


30. (C/NOFORN) The first two of eight Excess Defense
Article (EDA) UH IIs were successfully delivered in November
2007, but the rug was quickly pulled out from under the
program by a rapidly decreased FMF budget. When the UH II
program began in 2005, Kazakhstan received $4.9 million in
FMF funds, an amount that had been steadily increasing on a
yearly basis. The original price for the refurbishment of
each UH II in 2005 was $3 million. At that time, with the
current and projected FMF funds, the SA system and
Kazakhstani MOD planned to complete UH II procurement and
refurbishment program by 2010. However, this is not longer
the case because FMF funding has decreased while
refurbishment costs have increased. Currently, at $4.2
million per aircraft for refurbishment, Kazakhstan needs
approximately $10 million to order the next two aircraft
(including $1 million for transportation and $600,000 for
spare parts and training),but currently only has about $6.5
million. Kazakhstan only received $1.3 million in FMF in FY
2008, a number which fell from almost $5 million in FY 2006.
As a result, the project is nearly stillborn. However, a
third UH II can be procured with the current accumulation of
FMF funds, and the Kazakhstani MOD will soon submit a Letter
of Request which we expect to be delivered to USASAC by the
end of January 2009.


31. (C/NOFORN) COMMENT: If the current trend of
refurbishment costs outpacing FMF funding is not reversed,
then we will have proven to be an unreliable assistance
partner. In addition to the funding issue, the success of
our SA process can be measured in terms of UH II operational
readiness rates, which have hovered at zero beginning in July

2008. The unreliability of our SA system and the so-called
"total package" approach reached its apex when the UH IIs
required routine 150 flight hour service and the total
package failed to deliver the required routine service
compliment of parts, a failure that has become the rule
rather than the exception. As a short-term fix, we are
working to order the parts and equipment necessary to
complete these basic periodic inspections. The reduction in
funding, combined with problems with the SA system, damage
U.S. reliability and credibility, as well as the credibility
of pro-U.S./Western allies within the MOD. The
anti-U.S./pro-Russian faction within the MOD will use this to
undercut our supporters within the government, and does not
require an active role but passively points to the

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unreliability of the U.S. as a security partner.
Specifically, it hurts Deputy Defense Minister Sembinov, who
has staked his reputation on the HMMWVs and UH IIs in order
to show the skeptics that the U.S. is a credible and reliable
partner, that U.S./Western technology is superior and that
Kazakhstan,s soldiers can be trained to use and sustain
U.S./Western equipment. We are working to find alternative
means to fund the Huey II program and have recently included
this request as part of FY 2009 1206 funding proposals, but
have been told repeatedly that attempts to fund the UH II
program with 1206 monies will be denied. The delivery of the
two helicopters was a major news item in Kazakhstan that
reached the attention of President Nazarbayev. The death of
this program will surely reach him as well. Additionally,
should we prove unreliable partners on the UH II program,
there would be little reason for Kazakhstan to commit
national funds for the refurbishment of C-130s, the third
pillar of the HMMWV-UH II-C130 triad. END COMMENT.

C-130s


32. (S/NOFORN) Congress recently released C-130s as part of
the Excess Defense Articles (EDA) program. We had been
previously working this with Lockheed and SAF/IA and Navy IPO
to support Kazakhstan,s EDA request for six C-130s. The
C-130s could provide a valuable capstone for our bilateral
security cooperation, should we be able to overcome systemic
shortcomings. This is additionally a program directly
supported by the Deputy Minister of Defense,
General-Lieutenant Sembinov, who is committed to modernizing
the Kazakhstani military with U.S./Western military hardware.

MILITARY-TO-MILITARY (M2M) COOPERATION


33. (SBU) The CENTCOM M2M contact plan has grown to over
120 events in FY 2008 and will increase to about 150 in FY
2009 (NOTE: this figure does not include FMF, IMET,
Peacekeeping or 1206 projects. END NOTE). There has also
been a significant increase in the quality of events: the
subject matter is increasingly complex and comprehensive, and
event preparations are more professionally planned,
coordinated and executed. Kazakhstan has asked for U.S.
assistance through M2M activities in a number of key areas
that stand to have a long-term impact on the modernization
and transformation of their military, to include the
development of national military doctrine, curriculum and
faculty development for their Professional Military Education
(PME) institutions, and interoperability through acquisition
of equipment and TTP implementation.

CIVILIAN-TO-MILITARY (C2M) COOPERATION


34. (SBU) The CENTCOM C2M contact plan has also seen great
growth over the past three years, primarily due to the
interest of the Ministry of Emergency Situations (MES) in
working with U.S. agencies. The C2M programs are mainly
conducted by the U.S. Army Corps of Engineers, Arizona
National Guard (AZNG),and local Arizona emergency response
agencies via the National Guard Bureau (NGB) State
Partnership Program. MES interest was highlighted by a visit
to Arizona and Washington, D.C. by the MES Minister, Vladimir
Bozhko, in July 2008 to discuss the C2M program and set the
stage for future C2M cooperation. Minister Bozhko was
engaged and extremely pleased with his visit, and clearly
outlined the areas he would like assistance from Arizona and
the Corps of Engineers. Unfortunately, the NGB State
Partnership Program was only allocated $2.2 million for C2M
programs in FY 2009, to distribute among 48 states with
programs in 63 countries. Arizona received a relatively
sizable $200,000 in available funds, but will only be able to
execute three of the 11 planned events with MES in FY 2009.
OMC has asked the AZNG for additional NGB funding for C2M
programs.


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PROFESSIONAL MILITARY EDUCATION (PME) ASSESSMENTS


35. (C/NOFORN) In March 2007, the MOD asked for assistance
in conducting a comprehensive series of assessments for PME
institutions, including the National Defense University, the
Ground Forces Institute, the Air Defense Forces Institute,
and the Defense Institute of Foreign Languages. These
assessments were completed as part of a series of visits by
teams from Defense Language Institute, West Point, Air Force
Academy, Army TRADOC (OBC/OAC),Air Force Staff College, Army
War College, and the George C. Marshall Center, and were
recently delivered to the Kazakhstani MOD. This is another
means by which the MOD is attempting to modernize and
transform its forces and will serve as the basis for many of
our future cooperation activities.

KAZBRIG EVOLUTION


36. (C/NOFORN) Deputy Minister Sembinov and General-Major
Maikeyev, Commander of the Airmobile Forces, have great hopes
for the future of KAZBRIG - Kazakhstan's dedicated Peace
Support Operations unit. Originally plans were to have most
of KAZBRIG manned, equipped, and trained by the end of 2009.
However, this has been delayed to 2010. One battalion is
currently manned, with the remaining two battalions being
manned in 2009 and 2010 respectively. Problems exist which
need to be overcome in order to meet manning expectations,
most of which is Kazakhstan,s retention of a partially
conscripted force. Additionally, KAZBRIG suffers a
continuous retention problem, with losses caused by a large
number of draftees leaving annually at the end of their
service, as well as NCOs/officers who are disillusioned by
the lack of a meaningful deployment and substandard pay and
benefits. KAZBRIG officers tend to attribute recruitment and
retention problems to this lack of deployment. Additionally,
Minister of Defense Akhmetov directed his own evaluations of
KAZBRIG. By all accounts, these "evaluations" had
predetermined results that were not very positive. It was
not, however, very clear whether Akhmetov was just looking
for KAZBRIG to fail to prove that cooperation with the United
States and NATO is a waste of time, or whether he was
stalling for time on a deployment announcement. Recently, we
have received positive indications that the Minister has
either begun to see the importance of cooperation with the
United States and NATO or that he has received guidance to
that effect from above. In May 2008, Akhmetov ordered a
no-notice inspection of KAZBRIG that resulted in an influx of
new personnel, although primarily conscripts, and equipment.
He also made personal appeals for assistance to several
Western partner nations for training KAZBRIG. Additionally,
the NATO evaluation from this year,s annual Steppe Eagle
exercise (US/UK/KZ) indicated the one operational battalion
of KAZBRIG is NATO interoperable with limitations.


37. (C/NOFORN) The Steppe Eagle exercise and NATO
evaluation were critical to a potential deployment
announcement for the KAZBRIG. A successful evaluation of the
KAZBRIG is a necessary, but not sufficient, condition for a
deployment announcement. Given that the only deployable unit
of KAZBRIG is a single battalion, to sustain operations over
the long-term the largest deployable unit is a company-size
element inherent to the 3:1 deploy-reset-train force
generation model. The past deployment of a platoon-size
element in support of OIF did not meet the 3:1 ratio,
however, future plans to deploy up to a company-size element
match current capacity. Our general belief, following a
deployment announcement, is that manning problems would
evaporate, training focus and assistance would increase, and
KAZBRIG would be ready to conduct basic peace support
operations in a low to medium threat environment under the
command of a lead nation.

NATO MAINTENANCE AND SUPPLY AGENCY (NAMSA) TRUST FUND


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38. (C/NOFORN) The NAMSA is the lead for a program to
destroy MANPADS (Man-Portable Air Defense Systems) and excess
Small Arms/Light Weapons in Kazakhstan. It is ready to
propose setting a deadline for Kazakhstan to approve the
Draft Implementing Agreement for the fully-funded, U.S.-led
NATO/PfP Trust Fund on MANPADS. NAMSA would like the United
States to threaten cancellation of the project if the
agreement is not soon signed. The Embassy has demarched the
Government of Kazakhstan on the issue and consulted with the
NATO Special Representative to Central Asia, Mr. Bob Simmons,
and the former resident NATO Liaison Officer to Central Asia,
Tugay Tuncer. The Embassy continues to pursue this with the
Government.

FINAL WORDS


39. (SBU) We are very much looking forward to your visit.
This is an auspicious time to visit Kazakhstan, which very
much values its strategic partnership with the United States.
The entire Mission looks forward to facilitating a rewarding
and productive visit with a valuable strategic partner who is
vital to our national strategic interests. We remain ready
to answer any of your questions. The primary point of
contact during your visit will be Defense Attache Colonel
Keith Harrington, Tel. 7 7172 702 393.
HOAGLAND